EU cracks down on Google with $3.5 bn penalty for abusing ad tech market power

The European Union on Friday imposed a €2.95 billion ($3.5 billion) penalty on Google, ruling that the company abused its dominance in digital advertising by giving preferential treatment to its own services, the fourth major antitrust fine against the tech giant in Europe and a softening of earlier threats from Brussels to consider breaking up its business.

The European Commission, the bloc’s executive arm and chief antitrust regulator, said Google must put an end to its “self-preferencing” behaviour and adopt measures to eliminate “conflicts of interest” across its advertising technology supply chain.

Rejecting the verdict, Google said it disagreed with the findings and confirmed it would challenge the ruling through an appeal.

“It imposes an unjustified fine and requires changes that will hurt thousands of European businesses by making it harder for them to make money,” Lee-Anne Mulholland, the company’s global head of regulatory affairs, said in a statement.

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The decision was long overdue, coming more than two years after the European Commission announced antitrust charges against Google.

The commission had said at the time that the only way to satisfy antitrust concerns about Google’s lucrative digital ad business was to sell off parts of its business. However, this decision marks a retreat from that earlier position and comes amid renewed tensions between Brussels and the Trump administration over trade, tariffs and technology regulation.

Top EU officials had said earlier that the commission was seeking a forced sale because past cases that ended with fines and requirements for Google to stop anti-competitive practices have not worked, allowing the company to continue its behaviour in a different form.

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The commission’s penalty follows a formal investigation that it opened in June 2021, looking into whether Google violated the bloc’s competition rules by favouring its own online display advertising technology services at the expense of rival publishers, advertisers and advertising technology services.

Its investigation found that Google “abused” its dominant positions in the ad-technology ecosystem, the commission said.

Online display ads are banners and text that appear on websites and are personalized based on an internet user’s browsing history.

Mulholland said, ”There’s nothing anticompetitive in providing services for ad buyers and sellers, and there are more alternatives to our services than ever before.”

With inputs from agencies